Troyens

Monday, April 14, 2014

Nobody Knows How to Read a 990

If you're interested in nonprofit organization finances, you owe it to yourself to become familiar with IRS Form 990. This is an annual tax filing required of nonprofits by the United States Internal Revenue Service, aka the Taxman. (The IRS is roughly equivalent to the Inland Revenue in the UK, I believe.)

The complexity of these forms varies enormously. I challenge you to understand the Metropolitan Museum of Art's 990, which includes information about attendance, assets (immense), income, donations, salaries, etc. The museum's assets include tens of thousands of art objects, valued at, I'm sure, billions of dollars, a huge and ever-expanding campus in NYC, etc., etc. It would take me a couple of days to fully comprehend the form.

But the 990 of a small nonprofit isn't that hard to deal with, and opera company 990s all have the same types of information.

For this reason, it's discouraging that I have now read, for the third time, that David Gockley makes more than a million dollars a year, most recent the claim that his base salary is $1.2 million. Folks, this is just not true. His base salary, as shown by some years of 990s, is currently around $525,000. The most recently filed 990 shows that Gockley received a one-time bonus of $1 million.

I went into some detail in SFCV a couple of weeks ago about why I believe he earned and deserves every penny of that bonus. I'm not happy about the failure of other people reporting on this subject to get his compensation right. A half-million dollar salary is reasonable for running a complicated organization with a $70 million annual budget. Misrepresenting his earnings because you didn't do enough research is not reasonable.